The following data were taken from the balance sheet of Albertini Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash $372,400 $285,500 Marketable securities 425,900 326,400 Accounts and notes receivable (net) 531,700 408,100 Inventories 343,200 210,600 Prepaid expenses 146,800 89,400 Total current assets $1,820,000 $1,320,000 Current liabilities: Accounts and notes payable (short-term) $404,000 $352,000 Accrued liabilities 296,000 248,000 Total current liabilities $700,000 $600,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year 1. Working capital 2. Current ratio 3. Quick ratio
The following data were taken from the balance sheet of Albertini Company at the end of two recent fiscal years: Current Year Previous Year Current assets: Cash $372,400 $285,500 Marketable securities 425,900 326,400 Accounts and notes receivable (net) 531,700 408,100 Inventories 343,200 210,600 Prepaid expenses 146,800 89,400 Total current assets $1,820,000 $1,320,000 Current liabilities: Accounts and notes payable (short-term) $404,000 $352,000 Accrued liabilities 296,000 248,000 Total current liabilities $700,000 $600,000 a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place. Current Year Previous Year 1. Working capital 2. Current ratio 3. Quick ratio
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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
Transcribed Image Text:The following data were taken from the balance sheet of Albertini Company at the end of two recent fiscal years:
Current Year
Previous Year
Current assets:
Cash
$372,400
$285,500
Marketable securities
425,900
326,400
Accounts and notes receivable (net)
531,700
408,100
Inventories
343,200
210,600
Prepaid expenses
146,800
89,400
Total current assets
$1,820,000
$1,320,000
Current liabilities:
Accounts and notes payable (short-term)
$404,000
$352,000
Accrued liabilities
296,000
248,000
Total current liabilities
$700,000
$600,000
a. Determine for each year (1) the working capital, (2) the current ratio, and (3) the quick ratio. Round ratios to one decimal place.
Current Year
Previous Year
1. Working capital
2. Current ratio
3. Quick ratio
b. The liquidity of Albertini has
from the preceding year to the current year. The working capital, current ratio, and quick ratio have all
Most of these changes are the
result of an
in current assets relative to current liabilities.
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